The Cobra Insurance Company is making $100 million from its auto insurance business
By Mike BohnenMICHIGAN, Mich.
— The Cobras are making $150 million in insurance revenue from auto insurance, with the company in a position to make a profit on any sales of vehicles it sells, a Michigan bankruptcy judge said Tuesday.
The Cobra insurance business generated a profit of $3.8 million in 2016.
Judge Robert D. Bail, of the U.S. Bankruptcy Court for the Eastern District of Michigan, said the Cobras’ plan to invest in a company called Cobra Insurance Company LLC is in compliance with the bankruptcy law.
Bails order requires the Cobra to repay $1.8 billion in assets it owes creditors and make $2.2 billion in repayments to creditors.
The company’s bankruptcy petition says it has a $100 billion balance sheet and is seeking to sell its auto-insurance business and to restructure its debt to fund the $2 billion of cash it needs to fund its business.
Bays filing said Cobra has an outstanding loan of $4.5 billion.
Cobra will file for Chapter 11 bankruptcy protection on Aug. 21, 2018.
Bains attorneys had argued the company’s assets should be valued at $10 billion.
The court said the company can pay $10 million to creditors who have outstanding loans totaling more than $9 billion.
Bets creditors will receive the balance of $2 million and the rest of the $4 million, Bays wrote.
The $2-million payment would cover all outstanding creditors and their obligations to Cobra.